President Barack Obama waves to reporters as he steps off the Marine One helicopter and walks on the South Lawn at the White House in Washington, Thursday, Dec. 27, 2012, as he returns early from his Hawaii vacation for meetings on the fiscal cliff. (AP Photo/Charles Dharapak)

WASHINGTON (AP) -- President Barack Obama says "the hour for immediate action is here" on a deal to avert the fiscal cliff.

The president says he remains "optimistic" that an agreement can be reached in Congress before a looming year-end deadline to avoid tax increases and spending cuts.

If Congress can't reach a deal, the president says Congress should allow a vote on a basic package that would preserve tax cuts for middle-class Americans while extending unemployment benefits for the long-term jobless and working toward a foundation for a broader deal.

The president says an hourlong meeting Friday with congressional leaders was "good and constructive."

Senate leaders say they hope to reach a compromise that could be presented to lawmakers by Sunday, little more than 24 hours before the deadline.

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WASHINGTON (AP) -- The Senate's top Democrat and Republican say they're entering last-minute talks with the White House aimed at avoiding the fiscal cliff.

Majority Leader Harry Reid and GOP leader Mitch McConnell gave the relatively upbeat assessment after the duo and top House leaders had what McConnell called a "good" meeting with President Barack Obama on Friday.